INDIA FISCAL MANAGEMENT REFORM PROJECT
PROJECT STATE: JHARKHAND
The Project aims to strengthen institutional structures and management systems in three
identified project states. This will enable and support the project states in making
effective fiscal decision making and realistic budget preparations, based on accurate data
and sound analysis. The project is expected to provide the necessary technical assistance
and relevant training for upgrading as well as creating requisite capacities for fulfilling
the objectives. The Project is being implemented by USAID, who has contracted Bearing
Point, Inc., USA as their Prime Consultant.
After consultations with the Ministry of Finance and State Governments, Bearing Point
presented a Draft Inception Report for the Project in the Project Facilitating Committee
on 19 March 2004. The Amended Version of the Inception Report was firmed up on 17
May 2004 and the approval of the State Action Plan was communicated by the Ministry
of Finance on 10 June 2004. The project activities have, thereafter, been taken up in right
REFORM ACTIVITY AREAS
Macroeconomic and Revenue Analysis
Expenditure Planning & Analysis
Human Resource Database/Pension Forecasting
Procurement Process Development
Development of Processes/Capacity for Evaluating and Managing Development
Design of Database for Tracking Socio-Economic Variables and Development of
Capacity for Using Data to Produce Analyses of Policy Choices
Build Capacity of Civil Servant Training Institutions
1. Sri M. S. Bhatia, Special Secretary, Finance, Jharkhand attended a training
program from 2 – 13 August 2004, in the Department of Economic
Affairs, in Andrew Young School of Policy Studies, Georgia State
University, Atlanta, USA.
2. Workshop on Project and Program Appraisal in the Public Sector, at
Ranchi from August 23 – 28, 2004.
Chief Secretary, Jharkhand inaugurated the workshop on 23rd August
2004, and forty 0fficials participated in the said program. This program
was well received as was evidenced by a very enthusiastic response and a
demand for further follow up sessions. Accordingly, the first follow up
session has been slated for 27 September 2004 to 3rd October 2004.
3. Workshop on Tax Analysis and Revenue Forecasting at Ranchi from 8th
September to 15 September 2004.
Chief Secretary, Jharkhand inaugurated the workshop on 8th September
2004. Thirty participants, comprising of twenty-four Officials of Revenue
Department and six representatives of Public Institutions participated in
this program. The new approach of involving academic institutions was
particularly useful in making the workshop a success. Thereafter, with
regard to VAT Preparedness a number of programmes including Outreach
program of Awareness and Education Campaign for VAT, Familiarization
of existing MODVAT arrangements in Central Excise Offices etc. were
4. After detailed deliberations a Fiscal Policy analysis Cell (FPAC) has been
set up in the Finance Department with a view of establishing capacities for
Policy Analysis and research activities in the field of fiscal and financial
A Debt Management and Investment Cell (DMIC) has been established to
study the institutions and organizational set up, gaps in debts and
investment management, extent of Contingent Liabilities, Risk Factors and
parameters necessary to scrutinize the risks, level of financing and
devolution of powers in the form of taxation, revenue empowerment of
local bodies was proposed to be studied in depth. It is also proposed to
study the system of accounting and keeping of records in Accountant
An introductory workshop on Debt Management for FPAC and DMIC
conducted on 26th April 2005. It was attended by 9 participants.
5. The existing Treasury operations and procedures and systems have also
been evaluated. A draft Cash Flow Model based on Excel format has been
developed. It is still to be firmed up and its acceptability and validity is yet
to be demonstrated. After the validation exercise is completed, adoption
and integration of the same in the Government. System of Accounting will
be worked out. Accordingly, thereafter a program of its introduction in the
Accounting System will be taken up.
PROGRAM AND PERFORMANCE BUDGETING
A Training Manual on Programme and Performance Budgeting is being
developed. Capacity building programme will be conducted on the basis of this
A two-day workshop was organized on 12-13th July, 2005 to launch the PPB
programme in Jharkhand which was attended by 13 full -time participants from
Pilot departments of Social Welfare and Water Resources along with Finance,
Human Resources Development, Health and Family Welfare and Rural
MACRO ECONOMIC/TAX FORECASTING CAPACITY BUILDING
Workshop on Tax Analysis and Revenue Forecasting held from 8 to 15 Sept.,
2004. Attended by 33 trainees.
Training manual on “ Tax Analysis and Revenue Forecasting” developed by
REFORM project and published by GOJ
Workshop on Macro economic issues conducted from May 28-June3, 2005 to
develop capacity in different departments of the state govt. and state civil services
PROJECT APPRAISAL CAPACITY BUILDING
Training in Financial Analysis imparted in August-November, 2004.
First round of case studies completed.
Second round of training program on Economic and Stakeholder Analysis
completed in April 2005.
Case studies in process.
Handholding and mentoring of case studies up to second stage i.e. economic
analysis is expected to be conducted by September 2005.
Training in Project Appraisal and Tax Analysis and Revenue Forecasting has
been included in the training calendar of Sri Krishna Institute of Public
Administration (SKIPA) and State Institute for Rural Development (SIRD).
Training in Project Appraisal and Training in Tax Analysis and Revenue
Forecasting shall be held at SIRD (Aug.-Sept., 2005) and SKIPA (Nov. 2005)
It has also been decided with the concurrence of SKIPA to make the institution a
repository of all training material, manuals, case studies, reports etc. prepared/
used by REFORM Project. Extending similar offer to SIRD is also being
CAPACITY BUILDING IN CIVIL SERVICE TRAINING INSTITUTIONS
Two premier govt. institutions viz. Sri Krishna Institute of Public Administration
(SKIPA) and State Institute of Rural Development (SIRD) have been taken up for
capacity building. Assessment of their needs and training gaps has been done
already and the draft report has been submitted. This will be finalized after
detailed discussions and further steps would follow.
Pending action in the light of the Needs Assessment Report, steps have already been
taken to initiate training on fiscal issues in the institutions.